"We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness. — That to secure these rights, Governments are instituted among Men, deriving their just powers from the consent of the governed,..."
Our Declaration of Independence

Sunday, July 5, 2009

Which State Has the Lowest Health Insurance Premium?

Good question and the answer may surprise you.

According to the state affordability reports by the HealthCareforAmericaNow, Hawaii has the most affordable health insurance premiums. And in case you're wondering how they arrived at this incredible discovery, I've listed where they got their information at the bottom of this article.

But just in case you're not living in Hawaii and not planning to move there soon I've compiled the date from all 50 state reports so you can see how your state is doing. And because the charts are too small to read you can click on them to see a larger version on a new browser window.

The 1st chart shows how much of your income dollars were being spent on health insurance premiums in 2006. And while this data is a few years old the next chart shows how much health insurance premiums have gone up from 2000 to 2007 for each of the states.

Remember the good old days when health insurance costs were less than 30¢ per $1 of income?

Click on images to see a larger version.

And while the rates don't look too bad for 2006 here's a graph of US health care costs vs time (2000 - 2007).

Now you may think that these rate increases are understandable because of inflation. And as the cost of things went up so did our wages.

The 3rd graph shows how much our incomes went up from 2000 to 2007.

And while the last 2 graphs may depress you, putting them together as I have in graph 4 is worse.

And now for the really bad news.

The country is now in a state of economic crisis where we have a high unemployment rate, a high home foreclosure rate and millions of people who can't afford health insurance. And while more and more are losing their jobs or taking cuts in pay, prices, including health insurance premiums, continue to rise.

With the current state of the economy, knowing how to project health care costs is uncertain. So while these costs may not continue to rise as much as they have in the past, I haven't seen any indication that they won't. In fact, because they continued to rise this year even when the average income fell, I think the following graph that projects how much of your income dollar will go to health insurance premiums may be optimistic.

As you can see, the projected cost for health insurance is still lower in Hawaii that the other 49 states. So maybe everyone living where health insurance premiums are going to be taking 50% or more of their income (Alabama, Connecticut, Indiana, Louisiana, Maine, Michigan, Mississippi, Missouri, Montana, Nebraska, New Mexico, North Carolina, Oregon, Pennsylvania, South Carolina, Texas and West Virginia) should move to a state where health insurance premiums are less.

Not ready to move and think the insurance rates should be the same for everyone? Well, I don't know how we can convince the insurance companies to have an across the state rate but if we did it would be 45.5% of your income. And that 45.5% is on top of the federal, state, county, social security and Medicare taxes!

Now the 1 thing I forgot to mention about all these health insurance charts is that all the numbers are based on employer sponsored insurance. And that's important to know since there are so many unemployed right now and non-employer sponsored insurance rates are higher.